Discover how Aduro Clean Technologies is revolutionizing plastics recycling with innovative chemical solutions that transform contaminated plastics into valuable feedstocks. Victoria Meyer welcomes Eric Appelman, Chief Revenue Officer at Aduro, to delve into the shift from traditional chemistry to green, renewable technologies, the challenges of commercializing sustainable solutions, and the impact of carbon pricing and consumer behavior on sustainability.
Eric shares insights on Aduro’s unique approach to chemical recycling, emphasizing the limitations of mechanical methods and the company’s pioneering technology that operates at lower conditions to efficiently remove contaminants. The conversation also touches on the importance of profitability in sustainability, the role of government regulations, and the global interest in viable recycling technologies. Learn how Aduro is setting the stage for a circular economy in the chemical industry with their upcoming plans for scaling operations and listing on NASDAQ.
Join us to learn more about the following topics this week:
- The chemical revolution: exploring the shift from traditional chemical practices to a more sustainable, circular economy.
- The future of chemical recycling: challenges and solutions
- The importance of consumer behavior and government policy in driving sustainable practices
- From lab to market: scalable sustainable innovation
- Leadership in a sustainable future
Killer Quote: “Sustainability isn’t just about doing the right thing for the environment; it’s about ensuring the solutions we create are commercially viable. It’s a natural selection process where only the most efficient and market-ready technologies will survive, similar to the evolution of the car industry in the early 1900s.” –Eric Appelman
Other links:
Aduro Clean Technologies Announces Pricing of US$4 Million Uplisting to Nasdaq
Watch Victoria and Eric’s Conversation on Youtube Here:
How To Scale Sustainable Technology
Hi, this is Victoria Meyer. Welcome back to The Chemical Show, Where Chemicals Means Business. Today, I have the opportunity to speak with Eric Appelman, who is the chief revenue officer at Aduro Clean Technologies. Eric has a long history in the chemical industry, both in traditional companies and now in green and renewable chemistry. So we’re going to be talking about that, about Aduro and more. Well, Eric, welcome to The Chemical Show.
Thanks for having me.
Glad to have you here. So let’s just get started with, what’s your origin story? How did you get interested in chemicals and how did you ultimately end up at Aduro?
Yeah, well maybe I should go 40 years back. I’m 60 now, when I was a kid and doing my chemistry jobs in the little house behind where I lived. Always fascinated how you could turn one thing in the other and that’s how it started. And at the end of the day, chemistry is a language. It is one language to describe the world around you. You can do it in German. You can do it with mathematics as well. And I just decided that I like the chemical language. That’s what happened. So it worked out in secondary school. It’s worked out when I was a chemical engineering student in the Netherlands and it has been good ever since.
That’s awesome. So tell us a little bit about Aduro.
Aduro, which is a company that I joined about a year ago is a project that has been around under other names for about 11 years. And originally it was not at all about green chemistry. It was about chopping up huge molecules of bitumen into small pieces so that you can bump it away from arctic positions to a refinery where people could make something with it. But it is a generic technology so you can use it to chop anything down that is too big to use. So about four years ago when the world was really hot on plastic recycling, the scientists decided to try it with great results. Around that time also, we became a stakeholder entity on the Toronto Stock Exchange, and the name Aduro came to be. Whereas we are still working on this, this bitumen upgrading plastics recycling is at this moment the big thing for us.
Excellent. And you guys have a presence in North America as well as in Europe, is that right?
Absolutely. And all the presence in Europe is me and my colleague who does PR from Germany. We are essentially a Canadian outfit. We are based in London, but in London, Ontario with about 25 laboratory people, that sort of thing.
Okay. That’s helpful. Cause I didn’t realize that it was just you and Stephanie as the European team.
Yeah.
That’s exciting. So Eric, you’ve seen a lot throughout your career, and a lot of the evolutions of companies and industry, et cetera. Today we’re in an era of sustainability, driven by a lot of things, right? Recognition that we need to have a cleaner, more sustainable environment, recognition that we want to reduce carbon in the environment. And so there’s a big focus and yet we are also seeing companies dialing back on commitments to sustainability, circularity and recycling. Why do you think that’s happening?
Yeah. That is a very good question indeed. I actually took some time to review what I have been doing over the last four decades. I came to the conclusion that in almost every job, I was in touch with sustainability and why is that? Well, sustainability often makes a lot of sense also commercially. So if we’re trying to reduce energy consumption, that’s good for the planet. There’s less emissions, but also your cost of your processes go down and that’s just a very good idea. If you take away some lasting contamination in a product that is, of course, good for the planet, but it is also good for the product as you offer it to your customers.
I think that is also leading to why you may be seeing now a little bit of a dialing back in the end of the day, sustainability cannot be paid for by good intentions only. It has to make sense. I actually sometimes say if a solution is actually not financially viable or financially less attractive, it probably actually means that it is less sustainable because I had to sacrifice more scarce resources. I think what we are seeing now is a typical development that you see always when something is really hot. A lot of people go on the track, try to do all sorts of clever ideas, and not all ideas will make it.
I have a little anecdote, around 1904 there was something like 396 car companies listed on the New York Stock Exchange. And how many are there today? So you do see that many people have ideas, consolidation, some will fall by the wayside.
Yeah.
And some technologies are obvious winners. I’m from the Netherlands, if I look to our part of the North Sea, perfect area, there’s always wind, it’s not very deep, we have tons of customers nearby, wind energy is a no brainer. But solar energy in our country, well, although it is doing better than you think, we are as north as Labrador here so in the winter, our days are very short and it becomes less attractive. I think that is what we are seeing. It is a natural selection process that we are witnessing. There are periods that everybody is running behind something and a lot of things are started. Then inevitably some things will turn out better than others. So I’m not worried.
In the Netherlands, we are now noticing that certain recycling companies don’t make it, but I think it is part of life. There’s probably all of a sudden 50 recycling companies and 2 or 3 are not making it. Yeah, the best will survive. I think that’s what you see. You also discover, that’s the other thing, it is not easy.
No.
We shall never underestimate how incredibly efficient our existing industries are. Of course, they had 100 years to become really good. And yes, we shall give good technologies the time to get there. But they also put a burden on us. So you just have to deliver and I think that is normal. And it will only make the world better.
Yeah. I think there’s so many good nuggets in there. Your analogy comparing this to automobile companies back in the early 1900s is great because you’re right. Everybody had an idea, but the reality is only a handful were truly profitable and replicable to the extent that it needed to be and sustainable if we use sustainable by another word, just meaning being able to provide that longevity.
The other piece, and I talk about this with folks is, I do think the chemical industry in many ways is inherently circular. We’re circular because it’s profitable because somebody saw a waste stream going to a flare and said surely there’s a better way of using those molecules. And, oh, sure enough, it gets diverted. It gets turned into something else that creates a revenue stream. So I think all of the new developments that we’re seeing today from Aduro to other companies, as we develop sustainable technologies it has to be profitable, and has to make sense on a number of levels. Ultimately things will shake out and there will be winners.
And of course you have to be honest in what things cost. Because gone are the days that you can belch out any sort of dirty gas and not pay for it. And thank God. By putting a price on it, it has been encouraged to develop new technologies. And yes, already in Europe,and soon in America, you’re paying for your carbon dioxide emissions. And that’s a good thing. And then you are realizing that I am consuming something. Just like when I’m consuming a raw material, when I’m emitting something, when I’m consuming clean air. As long as the pricing is fair, you will get the right incentives.
Right. Well, and I think the whole aspect of pricing is so interesting because it also in some ways ties to what technologies and approaches are going to be successful. It also ties to consumer and individual behavior. Number one, consumer’s willingness to pay more for a sustainable product they say they want. Secondly, you talked about the plastic recycling and that is a critical component of your technology, and others. Consumer and individual behaviors play such a big role, right? So I think this area of recycling has gotten a lot of misconceptions. So we assume, I assume, you assume, others maybe assume that whatever we place in a recycle bin is recycled and reused. That because it’s a plastic or because it’s a can or because it’s a bottle I can put it in the recycling bin and it’s going to get used. It’s got a useful life. And yet that’s not always the case. Can you talk about that?
Well, I’ll start with a bit on the consumer behavior and we talked a little bit up front about that. I grew up in the Netherlands, and we have a small country and we do not want to have a lot of landfills. And I know nothing better, from child onwards, that the local football club would come every month and collect my waste paper. They would bring it somewhere and someone would give them some money. So everybody automatically wins. And now we are doing the same with green waste. It’s getting a bit busy in my yard, but you do have a container for plastic waste, for green waste, for paper. And that is how it works. We always bring our bottles, actually without compensation, our glass bottles to the glass container. Because they’re everywhere. And we have already for many years a deposit system of many bottles. So, it is ingrained in that culture.
Yet, sometimes it’s difficult. If you are living in a high rise building in Rotterdam, it’s more difficult. And that is also where you sometimes have to show an understanding. And in those areas, we see something that I also see coming along in the United States. That government says, well, you know what? Don’t bother. You cannot have five containers on the 12th floor of your high rise. Just make sure you toss it in and we will develop an industrial separation. And that works as well. I’ve seen that in Texas, but I also see that here. It also teaches us that solutions can be different in different parts of the world, depending on social history, but also route, geography, circumstances.
In the end of the day, let’s face it, It makes no difference for me to throw my lemon peel in the green container or in one general container and next to each other. It’s just a habit.
It’s interesting, it is a habit and I think these are habits that have to be developed early, when we did our pre call, we talked about this and I also grew up recycling the newspaper. And in our case, it was the Boy Scouts that would collect it. Today we have curbside recycling and we use it, but one of the big challenges, certainly in a country like the U.S. and in other places is, we’re so spread out. That’s at least an excuse that affects the economics of recycling, whether it be curbside recycling or in your buildings and what have you. But there’s so much diversity in it. It’s not offered in many places, and it’s a challenge.
It’s a challenge because we need those recycled feedstocks. We need to recycle because it’s the right thing to do, in most cases. Secondly, we need those recycled feedstocks and you guys need those recycled feedstocks to make your technology successful. So let’s talk about what Aduro is doing in terms of addressing these challenges. What is Aduro’s approach to sustainability and technology and what are your solutions?
Yeah. Now, if we stick with your plastic bin, and in Canada it is a blue bin and here it’s a yellow bag. We bring all those plastics nicely together, but you can also sort them out at the Central Industrial Facility, there you have this whole heap of plastics. What are we going to do with it? The first thing you can do is you can pick out easy bits and an easy bit is an article like a PET bottle that is discreet and that is made out of just one material. Because if I have one material, I can easily convert it. I can in theory just melt it and then blow a new bottle from it. That’s what we call mechanical recycling and that is a very attractive technology because it requires little energy and little effort. In an ideal world, that is what we would like to do with everything. With some materials like paper or with cans, you can do that. But plastic is unfortunately a little bit more complicated because of all the plastic articles, and especially if you start to talk about films that we use to package our foods and all that sort of thing, we are looking at complicated materials.
To begin with, there is not just one material, but there are 10. Very often, we put several of those materials together in an article. The best example for me is always that wrap that you use around cheese or fish packaging. There is actually 11 different layers, and each layer does something. One layer keeps out the stinky cheese smell. One keeps the bugs out. One keeps the water in. And they all have their functionality. That’s a marvelous product, as a result of that, my cheese is not going to perish in days. But you can actually keep it for sometimes years. Recycling wise, it is a nightmare. Dealing with that diversity is an enormous problem and cost factor. Then, of course, once it has been in the bin, in theory anything can be on it.
Right.
Any germ, pathogen, medical waste or whatever else. That is when you lose sometimes the applicability of that recycled stuff. Because you do not really want to pack your fresh food in something that was yesterday in a bin with a very undefined environment. So that is why that mechanical recycling, as we call it, which is just picking out and remelting, has its limitations. Then comes in chemical recycling. Then you say, okay, all that plastic that is too dirty or too unknown or too unpredictable. I’m going to try and turn that back into chemical feedstock. That is our business, but how good can you do it? I’ll tell you, there is more than a hundred companies who are in that business, but Aduro is the one and only that does something different. I almost dare to say all the hundred pursue one technology, whereas we pursue on our own another one.
Now, what do the other guys do? They say, okay, I’ll take all that plastic and I’ll just crank up the heat. Then the stuff falls to pieces and I get something that looks a little bit like gasoline. Naphtha, and that is a feedstock for the petrochemical industry. Unfortunately, in that process, all the impurities that you started out with are going to travel all the way through and they end up in your gasoline as well. Before you can then take it into a major chemical outfit, you have to clean it up. We call that upgrading. In that upgrading, we remove all that contaminant. We also upgrade the so called saturation. That’s a chemical term which I will not touch anymore.
Now we come back to that financial argument. You may argue, okay, but waste is for free. Well, actually waste is not for free because you had to collect it at the curbside. You probably had to wash it or take some dirt out and subsequently you did some sorting and you took these easy bits out. By the time you are looking at that heap of dirty film, you’re looking at $200.
To your point, I think every part along the value chain needs to make a profit.
Exactly, or else the wheel won’t spin.
So, when I talk to people today about in particular PET recycling and the cost of getting PET bales, it’s actually quite expensive, right? There’s markers out there, there’s traded values or track values on it, and it’s expensive because of the effort that it takes to go in there. So there’s a cost, but there’s also a relatively small amount of useful product.
Compare it to crude oil. You go to some desert, you hit a hole in the ground. Then you fill up your mammoth tank of a hundred thousand tons and you say like to a big petrochemical company. Logistically, it’s much more easy. Now the good thing about what we do at Aduro is that if we take that heterogeneous mixture, we will deal with these contaminants in such a way that they very elegantly leave the process through the side door. The oil or the naphtha that we make, it’s clean enough to be sent into a petrochemical facility without any additional treatment. That is a colossal game changer.
That is a game changer. Is this a catalytic process? I mean, can you shed any insight into like how this is happening?
Yeah, I can try to do that. I apologize to the audience that is not that chemical. But what we do is we do the process at relatively low conditions by using a catalyst, as you say. So not as hot. What we do is by adding a little bit of water and a little bit of a simple, organic molecule, think of ethanol or glycerol. We let several reactions happen at the same time. And because of the presence of the water and that other molecule, we are able to almost refine that complicated dirtiness and produce a very clean hydrocarbon that you can stick into your chemical plant. And that does not only mean that we save a lot of post-treatment costs, but it also means that we do not do so much work up front because we can take that dirty mix rather than a highly pure mix.
And you still have to find a place to send the impurities, but you’re doing it in a different way.
You’ll concentrate that and as you say, the whole value circle, as I call it value chain, it still has to shape up. But I could see that more may go for that. You’re talking about less than 10% of the original that goes to incineration. Maybe it goes to a gasification and back to something. And you may even get to minerals recovery, but that is all far away. That’s not our home turf.
Yeah. Interesting. So what’s been the customer or market response to your technology and your offerings?
And it’s very interesting, the first question is, of course, who are my customers? I talked about your value circle. And there are a number of actors. One actor is the petrochemical industry. They are, of course, used to big chemicals and they could handle it. But they have an interesting question, dooming, looming, and that is the obligation to supply circular carbon. We are going to a situation where we will have minimal recycled content. And then it is better that you have that. So they have a big interest. I think I’m fair if I’m saying that any big petrochemical company that I have approached with our story loved it. They are all following it and they’re asking for clarifications. Of course they are picky and of course they are critical, but they really see that what we do, which is recycling of that carbon at the lowest possible cost and at the lowest possible loss and at the lowest possible aftertreatment and complexity, holds tremendous promise. So I have easily 10 major petrochemicals all over the world who are observing very closely what we’re doing.
But it’s not only them, because on the other side, is the guys that collect all the waste. The waste management companies. They have to make a living as well, by creating as much value as possible from those waste streams. They also realize that, I do need a solution for the dirty stuff, to make the whole recycling affordable. It is always easy to take 20% that is easy to recycle, but, by the way, what am I now going to do with that 80% that is left? That is obviously more horrible than what I started out with. So they need a solution for everything. That is why it’s actually a bit of a tendency of the last months that I noticed that the waste management companies realized that they need a good suite of technologies to deal with all that plastic and then all that plastic and no sort of hazy leftovers that I have to landfill anyway or something like that.
Yeah. I like that description of a suite of technologies. Cause I do think there’s not going to be a single winner or loser in this, that there has to be an array of technology solutions and approaches, that will help us win the game.
Yeah, absolutely.
Are you guys on your path to commercialization? I know from talking to other leaders in this space that it is not a straightforward path, nor short.
No, we started a little bit late because most people on competing pathways, they started already in 2005. It’s a long time ago and it sounds odd, but in those days we were very nervous that we didn’t have enough fossil carbon. That was very quickly resolved by some creative people in the United States who discovered fracking or upgraded fracking and then suddenly that problem was solved. But a lot of people at that moment started to work converting plastic waste to fuels. Then they all went a bit into hibernation, but they had all the technology ready. When the plastic case came up, they could just pick it up again. We came from that corner of bitumen, and it was our first trick.
It is only like four years ago that he said, okay, let’s see what we can do with plastic waste as well. We are now at a stage where we’re building our pilot plant, continuous integrated pilot plant. That will be right in the beginning of next year. Then we will be able to test all sorts of wastes. We will be able to set all sorts of conditions. And then it should go quickly towards commercial installations.
Obviously you guys are Canadian based. Is the target North America or somewhere else?
Here you’re almost into politics. Which are the places where you will have traction first? You can argue in Europe we have a long tradition of recycling. We also have a tradition, which is a little bit less well known, that chemical industry takes liquids as a feedstock. So Europe might be a very good place to start out with it. The beauty that I always have had about North America, and that’s why my sons and I, we love places like Texas, if something works you just go for it. You build for it and you access your massive capital markets and your scaling ability and not for the first time you might see here that in the end of the day, in North America, the first factories might come along because it works so kind of hard to say.
But I have also a company in Southeast Asia who is very interested. This is, of course, one of those areas where plastic waste in the environment is a colossal problem because in the end of the day in America and in Europe, we at least collect this garbage. But in those countries, that is not always logical. So tremendous interest from Southeast Asia, tremendous interest from Latin America, where it will go first, anybody’s guess. I would say Europe, very likely. But I do also see good possibilities in especially the United States.
Yeah, well, I guess we’ll see. This is all part of the game and part of the gamble in some ways. To see how the solutions really manifest, and when and where.
And you must be open. That is very important. What is very important for us also for that reason is that we talk to everyone. So rather than withdrawing in a laboratory and cooking up a very nice solution, we should be in a permanent dialogue with the industry. And you will see that there will be changes. I think 10 years ago, everybody was thinking we will have beautiful, clean plastics to recycle. Unfortunately, that’s not the case. If you would have built your proposition on that, you would be dead in the water. I think it is very important to be everywhere, listen to the possibility and also tune your proposition. In America, we need a different way of products and we’ll do that.
I think certainly governmental regulations has a huge part to play in this, both in the investments and what’s being offered to support sustainable and green technologies. That’s one side of it, but also even in terms of what products are allowed to be used. I know France famously banned plastic wrap on cucumbers and other vegetables. So that you could say, okay, well, that’s great. So you’re not going to get that, but in the U.S. it’s still prevalent and elsewhere. So I think there’s just different local customs and local practices.
So I want to turn to a question that, by the way, I didn’t tell you I was going to ask you this, but I know that you can handle it. I want to talk about leadership, you’ve obviously experienced big companies, private companies, small companies, developing companies. What are the two or three defining characteristics of leaders that are able to really achieve growth and take a new business, a new technology and evolve it? What do you see as being critical?
I’ve actually always been in the business of bringing new ideas and technologies to the market and I have recognized three factors. That they need to have to work. The first one is what I call real strengths. That means that you must have something that is really differentiated. It’s not like 5% better than other things. If you start from scratch, you better start from a really good idea. Marginal improvement is the good territory for the big companies. They will optimize and they have the time for it. If you bring something new, you have to build on a real strength. A really good idea, well protected.
The other thing that is of course very important, there must be a real need. And I have worked quite a bit in my earlier career, for instance, in supplying to the cosmetics industry. We were always saying, yeah of course they want to have vegetable ingredients. But as soon as she then came down and was costing five pennies more, they actually happily took the fossil ingredients or whatever else. It is actually an industry that is not green at all. So there was no real need. You must be brutal that this was actually not a need. It was silly to pursue that idea because that was something that you concocted up yourself.
The third thing that is incredibly important is an alignment of the stars. What I mean by that is there are millions of reasons why your customers, even if you had the best idea, would say thank you, but no. You do have to find those Interactions where you have them. That’s why I want to talk to many customers because customers, A, B, and C might say this is a brilliant idea, but you know what? I just changed my CEO last time that I had an issue with my factory here. And there is millions of reasons why people will not take something. You have to very aggressively hunt for what it is. What does it mean in terms of leadership? Be brutally honest about how good your idea is and what your customer really wants.
The last one is be open and be searching and be on the hunt and find those pockets where your idea is going to work. So be out looking. In my previous job, I was director of an innovation campus where we had more than a hundred companies trying to do things and a lot of startups as well. The ones that are really good are the ones that you saw a real need, real strength, but also a strong outlooking attitudes. Too many stay in the laboratory and try to make it even better without actually knowing what a customer wants.
Progress over perfection.
Yeah, leadership must be outside looking in and it must be brutally honest.
That’s good. I like that. Eric, what should we be looking forward to from you and from Aduro Clean Technologies over the next 12 to 18 months?
Well, to begin with, we are now on that very exciting scaling trend. I hope that we will be able to attract a lot of people. And what I would like to create is a theater where interested companies, being in petrochemical or being at a waste management company or others, brand owners, all welcome, where they can witness what we are doing and where they will be impressed by what we do. I have no hesitation that our technology from where we are now will be readily scalable and that we will reach that. The other theater where we are acting and that is the sort of beautiful ambidextrous life of a good startup. This is that we are working with investors. We are financed by retail investors, and it is a fantastic thing to realize that we are going to be listing on the Nasdaq very soon.
That’s exciting.
To attract more money and more funds for this one.
Are you currently listed today?
We are listed in Toronto and in Frankfurt. On The Starters Exchange, but that’s relatively low liquidity, obviously by going to the United States you come to the heaven of capital.
Yeah. I think that’s very cool. Until recently I hadn’t realized that startup companies such as yours were actually listing on the Nasdaq as a means of raising capital. So I think that’s really exciting.
Originally it starts often by making your retail investors able to trade. Because there’s no liquidity, of course, until you’re enlisted, but it is done in a secondary step. It becomes a way to attract money and we have done a couple of raises in a row. We’ve, by the way, never traded down. Every new raise was for a higher price than before. That is how we work, and this will be a very exciting next step.
Can’t wait to see it. Well, Eric, thank you for taking the time to speak with me today. I love what you are doing with Aduro Clean Technologies and I think it’s going to be great.
Thank you so much. I enjoyed this very much.
Absolutely, and thank you everyone for joining us today. Keep listening, keep following, keep sharing, and we will talk with you again soon.
About Eric Appelman:
Eric brings 35 years of experience in a variety of jobs and companies in the chemical industry. He worked with Unilever in their edible oils’ business; he was technical director at Sigma Coatings and EVP for innovation, market development and corporate strategy at the Swedish multinational Perstorp. Most recently Eric was CTO and Marketing & Sales Director at Brightlands Chemelot Campus, the largest industrial innovation environment for the chemical industry in the world. Eric met Aduro at Brightlands and was immediately captivated by its unique technology, which offers big advantages versus more traditional recycling technologies: an increased fraction of waste plastic accessible for recycling, a very efficient process combining multiple steps, and an excellent product! What makes him tick is working with customers, mapping the needs and linking those to the capabilities of the own team. In doing so, he contributed to a big variety of products to the market.